Adult Children's Urbanization and Family Farmland Transfer: Evidence From China

Abstract

The transfer of agricultural land from families to external entities can enhance land use efficiency, leading to reduced production costs and increased farmer income. However, the decision to transfer family farmland is influenced not only by macroeconomic policies and farmers' actions but also by the decisions of their adult children. This study investigates how the urbanization of adult children impacts household land transfer decisions. Using data from the China Family Panel Studies from 2012 to 2020, the research employs an Extended Regression Model to analyze this relationship. The findings reveal that adult children's urbanization significantly raises the likelihood of family farmland transfer. Further, heterogeneity analysis finds that this effect is more pronounced in households with smaller families, fewer children, no male offspring, and higher incomes. The study identifies three mechanisms through which adult children's urbanization promotes household farmland transfer: the aging effect, the accompanying migration effect, and the wealth effect.